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The Performance of Hotels in Europe is Above the Prerecession Level

According to the newest data provided by STR Global, Europe’s hotel industry is performing well despite a series of challenges. The occupancy for the period of January to September is 2017 remains high. The absolute occupancy of the continent was 72.6% in September. That is 2.6% higher than during the same period a year ago and, what’s more important, 9.0% higher than in September 2008. That is, indeed, a very promising result that only proves that the hospitality industry of the region continues its strong performance.

Experts regularly point out to potential risks for European hotels. In addition to the global rise of the peer-to-peer rental industry (companies like Airbnb), the hospitality industry has to cope with multiple difficulties caused by terror attacks. However, the region shows resilience and strength despite all challenges. The statistic also proves that the hospitality industry recovers from terror attacks faster than expected. Hotels in Berlin, London, and Barcelona didn’t suffer from drastic reductions after these acts of violence.

In September 2017, the majority of large European cities posted year-on-year growth in RevPAR (revenue per available room). Zurich hotels were among a few outsiders with the decline in this metric of 3.1%. The reason for this is simple  strong Swiss franc against euro makes it pricier to visit the city. Istanbul hotels, in their turn, enjoyed the biggest RevPAR growth in the continent (+31.8%). However, there is also an explanation for such a growth. The basis of comparison, September 2016, is incredibly low due to terrorism problems during that period.

In the months when some destination had to struggle with consequences of terror attacks, other European destinations enjoyed strong demand. That is particularly true about Central and Eastern Europe, and the Iberian Peninsula. These markets have many destinations with the double-digit growth. Hotels in Budapest, for example, enjoyed the growth in RevPAR of 18.4%, and Lisbon hotels - of 20.0%. Other European cities with notable revenue growth are Madrid (+19.1%), Warsaw (+11.3%), Kiev (+24.1%), and Barcelona (+15.1).

Talking about Barcelona, it’s important to mention that the August terror attacks didn’t have a long-term effect on hotels in the city, but the Catalan Independence Referendum caused a substantial decline in October. The UK hotel industry also posts promising results despite Brexit and attacks in London and Manchester. Falling pound was a major boost for both domestic and international travel. As the sterling exchange rate is growing, London hotels might see their occupancy falling in the near future.